State News - UTIMCO directors vote for portfolio disclosure 09/20/02

Published: Friday, September 20, 2002

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UTIMCO directors vote for portfolio disclosureDALLAS (AP)  The performance of investments that benefit the University of Texas and Texas A&M University systems will become public information despite concern that disclosure would cause more successful funds to turn away future investments.

The University of Texas Investments Management Co. board of directors voted this week in Dallas to disclose the performance of the Permanent University Fund's $1.7 billion portfolio of private equity investments.

"Right now, we're in an environment where disclosure is so important," said UTIMCO President Bob Boldt. "Because of confidence in all institutions right now, not to disclose just couldn't be an option for us anymore. At the end of the day, we will perhaps take some loss in worth to opt for more full disclosure."

Boldt told the board during Wednesday's meeting that secrecy is the standard in the private equity business. Boldt said if the investment returns are released, some of the more successful partners might not accept UTIMCO investments in the future.

Boldt said that if confidentiality clauses exist in the 140 partnerships, UTIMCO would ask each individual firm to waive the provision. If the firm refuses, UTIMCO would take the matter to the state attorney general for a ruling.

"The issue is that these firms are private and they want to operate out of the glare of the public light," Boldt said. "They feel that they can because of investment skill. They have market power and can extract firms like us that are favorable to them."

Waiving a privacy clause could, in turn, make it more difficult for UTIMCO to partner with more successful firms.